The world economy has seen an extraordinary expansion in the last five years, and the creative industries are in the forefront of this growth. They are blossoming as a result of the globalisation and connectivity that have been reshaping the overall pattern of cultural production, consumption, and trade and transforming lifestyles worldwide.

The creative industries are at the crossroads of the arts, culture, business, and technology. They include the creation, production, and distribution of goods and services that use intellectual capital as primary input. Today’s creative industries involve the interplay of traditional, technology-intensive and service-oriented subsectors. They range from folk art, festivals, books, paintings, and the performing arts to more technology-intensive sectors like the film industry, broadcasting, digital animation and video games, and more service-oriented fields like architectural and advertising services.

Leading component

All these activities are intensive in creative skills and can generate income through trade and intellectual property rights (IPRs). In most advanced countries, the creative economy is a leading component of economic growth, employment, and trade.

Ongoing policy-oriented research and analysis by UNCTAD (United Nations Conference on Trade and Development) also finds the creative industries are among the most dynamic emerging sectors in world trade. Over the period 2000-05, trade in creative goods and services increased at an unprecedented annual average of 8.7 per cent.

This rise is attributable primarily to China, which became the world’s leading exporter of creative goods in 2005. The dynamic creative economies of other developing countries, mainly in Asia, have also begun to bear fruit, thanks largely to policies aimed at strengthening their creative capacities and improving the competitiveness of their creative goods and services. Some of the creative products enjoying rising popularity in world markets include Indian movies and software, Mexican TV stations, and Korean digital animation products.

Design, arts and crafts are the most competitive creative goods from developing countries in world markets. Overall, world exports of audio visuals tripled, and exports of visual arts doubled, between 1996 and 2005.
While such figures cannot possibly capture the magnitude of the contribution of the creative industries to national economies, especially in developing countries, the trend is indeed very important. The lion’s share of creative revenues is generated by copyrights, licences, and marketing and distribution. Unfortunately for the developing countries that produce the products or services, however, most of this revenue accrues to large companies abroad.

Challenges

But there is another challenge to be faced, one that is both domestic and systemic. Most developing countries are not yet able to harness their creative capacities for development. At the domestic level, developing countries in general will have to upgrade quality throughout the productive value chain, set up institutional and financing mechanisms to support independent artists and creators, and create policies to attract investments that facilitate joint ventures and co-productions.

Public/private partnerships will need to be promoted; competition policies enhanced, and awareness of IPRs stepped up. Opportunities must also be created to access advanced technologies and increase the use of new business models and Information and Communication Technologies (ICT) tools to reach new markets, including South-South trade.

There are, however, constraints at the international level as well, related to market access and non-competitive business practices that arise from the oligopolistic market structure, especially in the audiovisual and digital industries.

The concentration of marketing channels and distribution networks in a few major markets; limited access to regional and multilateral credit; and technological exclusion all combine to jeopardise the competitiveness of creative products and services from developing countries in world markets.

– IPS (The writer is secretary-general of UNCTAD)